Argued and Submitted July 18, 2013.
Clackamas County Circuit Court. CV10010159. Susie L. Norby, Judge.
Brian J. Posewitz argued the cause and filed the briefs for appellants.
Inge D. Wells, Senior Assistant Attorney General, argued the cause for respondent Oregon Water Resources Department. With her on the brief were Ellen F. Rosenblum, Attorney General, and Anna M. Joyce, Solicitor General.
No appearance for respondent Robert Lytle.
Before Armstrong, Presiding Judge, and Nakamoto, Judge, and Egan, Judge.
[264 Or.App. 111] NAKAMOTO, J.
Petitioners appeal following the circuit court's judicial review of an order by the Oregon Water Resources Department (the department) in other than a contested case. The order permitted petitioners' neighboring landowner, Lytle, to maintain a reservoir in a stream that runs on his property as well as petitioners' properties, with certain conditions. The circuit court set aside and remanded the order on the basis that Lytle's permit application was substantively deficient and that the department had misapplied the relevant statute, ORS 537.409, when it concluded otherwise. Petitioners now ask this court to reverse and remand the order on additional grounds. For the reasons that follow, we affirm.
The following facts are not in dispute. Petitioners, Noble and Hillison, each own property along a stream. The stream is an unnamed tributary to Beaver Creek, which flows into the Willamette River near Oregon City. Respondent Lytle also owns property along the stream, downstream from Noble and upstream from Hillison. A small dam along the stream on Lytle's property creates a reservoir. Lytle's reservoir was created sometime before he purchased his property in 1975. Lytle applied to the department for a reservoir permit under ORS 537.409, a statute that establishes an " alternate" and expedited permit application process for qualifying small reservoirs.
The owner of a small reservoir may apply for a permit for the reservoir under ORS 537.409 if, in addition to satisfying other criteria not at issue on appeal, the reservoir does not " pose a significant detrimental impact to existing fishery resources as determined by the State Department of Fish and Wildlife" and does not " injure any existing water right[.]" ORS 537.409(1). An application must include sufficient information to demonstrate that the reservoir meets those criteria. ORS 537.409(2). During a 60-day period after public notice of the application, any person may submit written comments and may request that the department deny the application on the basis that the reservoir " [w]ould pose a significant detrimental impact to existing fishery resources" or " [w]ould result in injury to an existing water [264 Or.App. 112] right[.]" ORS 537.409(5). In response to such a request, the department must conduct a public-interest review of the reservoir application. ORS 537.409(6). That review is limited to " issues pertaining to * * * [w]ater availability[,] * * * [p]otential detrimental impact to existing fishery resources[,] and * * * [p]otential injury to existing water rights." Id. Within 180 days of receiving a permit application, the department must issue a final order " granting or denying the permit or granting the permit with conditions." ORS 537.409(7). If the department does not find " injury or impact under subsection (6) * * * [and] issues a final order under subsection (7) * * * allowing the issuance of a permit," the order is subject to review as provided in ORS chapter 183 as an order in other than a contested case. ORS 537.409(9)
Here, upon receiving Lytle's application, the department sent comment forms to the Oregon Department of Fish and Wildlife (Fish and Wildlife) and the Oregon Department of Environmental Quality (Environmental Quality) regarding the issues of harm to fishery resources and water rights. In response to the department's solicitation, a Fish and Wildlife fish biologist, Faucera, submitted comments to the department concluding that, although fish were present in the creek fed by the stream, Lytle's proposed reservoir would not " pose a significant detrimental impact to an existing fishery resource[.]" Faucera also indicated that certain specific conditions--namely, limiting the period of use of the reservoir from November through March and requiring installation of state-approved fish-screening and by-pass devices prior to diversion of any water--could be applied " to mitigate the detrimental impact to an existing fishery resource[.]" The Environmental Quality representative, Karen Williams, stated in her comments that she did not know whether the reservoir would " pose a significant detrimental impact to an existing fishery resource" because, " [a]ccording to [the department's] maps, a dam blocks fish passage to Beaver Creek."
Petitioners submitted comments to the department opposing issuance of the permit on the bases that the proposed reservoir " would
have a significant detrimental impact on the fishery resource of the Unnamed Stream" and " also [264 Or.App. 113] would injure existing water rights." Petitioners requested that the department deny the application. Petitioners also requested that, if the department nevertheless determined that it would grant the permit, that the permit " be conditioned to limit the season of use to winter months (November through February), to require mechanisms for release of water during non-winter months, and to require structures sufficient to provide fish passage in all seasons." Petitioners further requested that the permit also be " conditioned to require suitable measuring devices, to require measuring and reporting by the permit holder, and to require mechanisms sufficient to ensure passage of water in excess of any legal impoundment rights." According to petitioners, the " latter conditions are necessary to make proper regulation of the permit possible."
Following a public-interest review, the department issued an order (Order #1) granting Lytle a permit. The permit required Lytle to adhere to the conditions suggested by Faucera--limitation of use to the months of November through March and installation, maintenance, and operation of fish-screening and by-pass devices consistent with department standards--as well as additional conditions requiring that Lytle provide for " means to evacuate water when determined necessary by the Water Resources Director to satisfy prior downstream water rights * * * [and] pass all live flow outside the storage season described * * *." The permit also granted the department the discretion to require Lytle to install a measuring device and to measure and report water use information. The department concluded that, as conditioned, the reservoir " will not injure any existing water rights and does not pose potential detrimental impacts to existing fishery resources."
Petitioners sought judicial review of Order #1. However, the parties subsequently agreed to try to resolve the dispute through mediation. Pursuant to that agreement, the department withdrew Order #1 and, along with it, Lytle's permit.
The mediation failed and the department reprocessed Lytle's application. The department solicited and received comments from the local watermaster as well as a [264 Or.App. 114] second set of comments from Faucera at Fish and Wildlife. The watermaster concluded that the proposed reservoir had " the potential to injure existing water rights[,]" but that conditions could " be applied to mitigate the ...